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After reporting results that beat top and bottom line estimates yesterday, shares of Pandora Media (P - Free Report) surged almost 20% early morning Wednesday. Due to advertising and strong subscription rates, revenues also increased 12% year-over-year, exceeding top end guidance.

At this point, a lot of people believe that Pandora is simply playing catch-up to its rival media streaming services like Spotify (SPOT - Free Report) or Apple’s APPL Apple Music. However, with Pandora’s premium subscription feature, partnerships and enhancements to their ad /program offerings, it could find its place again in the music streaming service industry.

Where Do Pandora’s Competitors Stand?

Although Spotify saw a decline in its stock after posting its quarterly report, it spiked shortly after by 4%, bringing it to an all-time high of almost $200 per share. Both Apple Music and Spotify have seen an increase in premium subscription growth of 83 million and 40 million, respectively. Day by day, both of these media streaming services are growing with increasing subscription rates and revenues. Spotify has always been on the forefront in its industry, but Apple Music is coming to a close second. Both companies have come a long way with their respective strategies, with Pandora lagging behind. But looking at their latest quarterly report, it seems they might be starting to make gains.

That leads us to the question as to how Pandora’s stock surged after its quarterly report, and are people actually starting to express interest in the radio music service again.

Partnerships, Subscriber Growth & Advertising

Recently, Pandora announced a partnership with Snap (SNAP - Free Report) and AT&T(T - Free Report) . Shortly after the announcement of the partnership with SNAP, shares of Pandora rose almost 2%. According to Market Watch, the integration between the two companies would allow Pandora to extend its services to Snapchat's large audience while enhancing music discovery options through both the platforms.

Similarly, Pandora's partnership with AT&T also means good things for the company. With any AT&T unlimited data plan, customers would get Pandora Premium for free. This could potentially lead Pandora to add around 500,000 premium subscribers over the next year.

This year, Pandora announced its new feature of premium subscription, similar to Spotify and Apple Music. In fact, in its most recent quarterly report, Pandora announced a 67% increase in premium subscription rates ending with almost 6 million subscribers by the end of Q2. The total revenue for Pandora was about $385 million, with $113 million in subscription revenue.

The company has seen a huge interest in its premium features, which some people thought was a little too late for the company to be introducing. Although it’s very similar to what Spotify offers with its premium feature, long time users of Pandora have been enjoying the new addition.

Over this past year, Pandora also acquired digital audio advertising platform AdsWizz. The idea behind this acquisition was to enhance their programmatic advertising efforts. Through Pandora’s programmatic advertising it allows advertisers to engage listeners with their ads at the right time. The company also sees potential in ad-supported listening, besides its premium feature.

According to CFO Naveen Chopra, Pandora is trying to take a more balanced approach when it comes to the premium subscription market and the ad-supported market.

Bottom Line

There could be a chance Pandora could catch up to its rivals with its most recent success. Over the past year, Pandora’s stock has risen, as they are finally adding and changing around what their service includes. It could be a long stretch to assume that they could beat Apple Music and Spotify, but it can be said that it could come close to these powerhouse media streaming companies.

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